Larger Mortgage Down Payments Made by Home Buyers


The statistical data from 2013 presented in a recent report by Redfin, a brokerage firm operating in 25 metropolitan areas, reveals a steady increase in the mortgage down payments made by home buyers in the United States.

The median mortgage down payment for the most affordable 25% of all sold homes was 7.5% of the sales price in 2013. It was 4.2% on average during the period from 2001 to 2007 hitting its lowest point in 2006 when it was 3.1%. This accounts for an increase of 78.6%.

The median mortgage down payment made in 2013 was $9,480. It was around 36% lower in 2007 – $6,037.

The median mortgage down payment for the middle 50% of homes sold in the market was 8.8% in 2013. It has 8.2% on average during the period from 2001 to 2007. It climbed up by 7.3%.

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For the most expensive 25% of homes sold, the median down payment was 20.9% in 2013 and 19% on average in the period from 2001 to 2007. It rose by 10%.
The dramatic increase in the size of the mortgage down payments made by buyers purchasing properties in the most affordable 25% is attributed primarily to the increase in the cost of FHA loans. FHA loans are available with a minimum down payment of 3.5%. Currently, borrowers must obtain mortgage insurance which requires the payment of an up-front fee of 1.75% of the home loan balance and of annual premiums which can be as high as 1.35% of the outstanding mortgage balance.

In 2013, 39% of first-time home buyers in the United States used an FHA loan to buy a house. In 2010, 56% of the buyers in this group took advantage of the government-backed mortgage loans.

Mortgage lending marked a steady decline during the period as well. In the second quarter of 2014, the mortgage origination volume reached its lowest point since 2000.



Christian Calvin mortgage Christian is a contributing writer for He is a graduate from the University of Tennessee with a degree in Communications and a concentration in Broadcasting. Christian has served as vice-president for a privately-held company for more than 20 years. Additionally, he has also applied his writing and business knowledge to various websites with a focus on business and sports news . . . both of which are passions. Christian enjoys playing golf and spending time with his family and friends.


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